VET Student Loans FAQ


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VET Student Loans FAQ

Introduction to VET Student Loans

VET Student Loans is a government loan scheme designed to alleviate the pressure of paying for your higher level VET qualifications. Under VET Student Loans, the government provides eligible students with a loan to cover the cost of their qualifications which is only paid back once the student earns above the income threshold of $54,869p.a. for the 2016-2017 income year.

You are eligible for VET Student Loans if you:

  • are an Australian citizen or permanent humanitarian visa holder (resident in Australia for the duration of the unit); AND
  • are a full fee-paying / fee for service student studying a diploma, advanced diploma, graduate certificate or graduate diploma level course at an approved VET Student Loans provider; OR
  • have not exceeded the FEE-HELP limit (see below); AND
  • meet the tax file number (TFN) requirements: OR
  • if you don’t have a TFN you can give your provider a Certificate of application for a TFN. This certificate is available from the Australian Taxation Office (opens in a new window) after you have applied for a TFN; AND
  • submit the Request for VET Student Loans Assistance Form to your VET provider prior to the census date.

No (unless you have already reached your FEE-HELP limit). Any previous study you have undertaken, and any other financial debts you may have incurred will not affect your eligibility to access a VET Student Loans. As long as you meet the above eligibility criteria and have enough of your FEE-HELP limit (see above) left to cover your tuition fees, you will be able to access VET Student Loans.

Financial

There is no interest; however, a loan fee of 20% applies to all students accruing VET Student Loans. The loan fee does not count towards your FEE-HELP balance.

There is no interest charged on your VET Student Loans debt. However, your debt is indexed annually by the Australian Tax Office to maintain its real value. Any indexation amount does not increase your FEE-HELP balance.

VET Student Loans assistance is only available to eligible full fee paying students undertaking higher level VET qualifications (diploma, advanced diploma, graduate certificate and graduate diploma courses).

HECS-HELP is only available to eligible students in a Commonwealth support place studying a higher education qualification.

FEE-HELP is only available to eligible fee paying students undertaking a higher education award course.

Note that Irrespective of whether a student receives a loan under FEE-HELP or VET Student Loans, one FEE-HELP limit applies.

Eligible students can borrow up to the FEE-HELP limit to pay their tuition fees. The FEE-HELP limit is the total amount available to eligible students under both the VET Student Loans and FEE-HELP loan schemes. This means that any amount you borrow under either VET Student Loans or FEE-HELP will reduce your FEE-HELP balance (the amount of FEE-HELP you have left to use) until you have reached the FEE-HELP limit.

For 2017, the FEE‑HELP limit is $100,879 for most students. For students undertaking medicine, dentistry and veterinary science courses (as defined in the Higher Education Support Act 2003) the FEE‑HELP limit is $126,101.

The FEE-HELP limit is a lifetime limit and is not reset or ‘topped up’ by any repayments that you make.

You may wish to contact the Australian Tax Office on 13 28 61 to get the balance of your HELP account or to order an information statement.

It is important to keep a record of all CANs which are sent to you by your provider. You need to be aware of the total amount of tuition fees that have been paid on your behalf using VET Student Loans (and FEE-HELP if applicable). Your FEE-HELP balance is the amount of the FEE-HELP limit less the amount of any VET Student Loans loan you have requested for tuition fees.

A trustee or executor needs to lodge all outstanding income tax returns on behalf of the deceased person, up to the date or the person’s death. Any compulsory repayment included on an income tax notice of assessment relating to the period before the person’s death must be paid from the estate, but the remainder of the debt is cancelled. Neither the deceased person’s family nor the trustee is required to pay the remainder of the accumulated HELP debt.

Yes. The FEE-HELP limit is the amount of VET Student Loans or FEE-HELP you are able to borrow over a lifetime. As you use VET Student Loans or FEE-HELP to pay tuition fees, the amount you may borrow in the future is reduced. Once you borrow an amount equal to the FEE-HELP limit you will not be able to receive VET Student Loans (or FEE-HELP) assistance to pay tuition fees in the future. This applies even if you have partially or fully repaid your VET Student Loans (or FEE-HELP) loan.

If you have a FEE-HELP debt you should ensure that you have a sufficient FEE-HELP balance to cover the course you are enrolling in.

I have a FEE-HELP debt. Do I still need to apply for VET Student Loans?
If you are currently accessing FEE-HELP, or have in the past, you will still need to apply for VET Student Loans assistance.

I have a HECS debt. Does this affect the amount of VET Student Loans assistance I can access?
No. Although HECS-HELP is part of an accumulated HELP debt, having a current or past HECS-HELP debt does not affect your VET Student Loans limit or your eligibility for VET Student Loans assistance.

The VET Student Loans Information booklet outlines that students may be entitled to a tax deduction for their tuition fees, including fees deferred through VET Student Loans assistance, if there is a direct connection between their education and their work activities at the time the expense was incurred. Students can phone the ATO on 13 28 61 for further advice or visit the ATO website. The loan fee, the compulsory repayment and any voluntary repayment of a student’s VET Student Loans debt is not tax deductible.

If you never earn over the minimum repayment threshold for compulsory repayment, the loan is never required to be paid.

You start repaying your VET Student Loans loan when your repayment income is above the threshold for the year (Note that the threshold is adjusted each year to reflect any changes in average weekly earnings).

The current repayment income threshold for the 2013 – 14 financial year is $53,345
Your repayment income is calculated using the following amounts from your income tax return:

  • Your taxable income;
  • Reportable fringe benefits (as reported on the payment summary);
  • Total net investment loss (which includes net rental losses);
  • Reportable super contributions; and
  • Any exempt foreign employment income amounts.

If you have an accumulated HELP debt and earn above the threshold, a compulsory repayment will be included as part of your income tax. You must advise your payer(s) if you have an accumulated HELP debt. Your payer(s) must withhold an additional amount from payments made to you, to cover your compulsory repayment. For more information on repaying your HELP debts, including the latest Repaying Your Help Debt guide visit the Australian Taxation office website: www.ato.gov.au.

If you withdraw from your unit after the census date and have not withdrawn your Request for VET Student Loans assistance form you will have incurred a VET Student Loans debt.

If after the census date, special circumstances occur and you are unable to continue your studies, you can apply with us to have your FEE-HELP balance re-credited for that unit(s). You should note that there are time limits for applying to have your FEE-HELP balance re-credited due to special circumstances.

Yes. You can obtain VET Student Loans assistance for more than one course of study provided that you have sufficient FEE-HELP balance and are otherwise eligible. You must submit a separate Request for VET Student Loans assistance form for each course, even if both courses are with the same VET provider.

Yes. Eligible full-time and part-time students can access VET Student Loans assistance.

Yes. Previous qualifications or study results do not affect your eligibility for VET Student Loans; however, you are not entitled to VET Student Loans assistance for units in excess of what you need to do to be awarded your qualification.

If you fail a unit, you will still incur a VET Student Loans debt for that unit regardless of whether or not you attended any classes.

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